Business and labor push for ‘fiscal cliff’ deal

WASHINGTON — Business and labor leaders from around the country – including several groups from Maine – spread out across the nation’s capital on Wednesday to ramp up pressure on Congress and the White House to broker a deal on the looming “fiscal cliff.”

But, like members of Congress, they did not necessarily agree on how best to fix the country’s financial crisis.

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President Obama speaks at the White House Wednesday. He said reaching agreement to avoid the looming “fiscal cliff” is “too important for Washington to screw up.” REUTERS / Kevin Lamarque

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Members of the Campaign to Fix the Debt – a nationwide coalition of business executives and former elected officials – met with congressional leaders and White House officials. Their message: Work out a major solution to the deficit and fiscal cliff now, not later.

“The campaign is over,” said Maya MacGuineas, head of the nonpartisan campaign, saying the focus now should be on problem-solving.

“And that means the time for partisanship is going to have to be put aside,” she said.

Union leaders, meanwhile, were making the rounds in the Capitol urging lawmakers to adopt many of the proposals from the Democratic wing. The unions want Congress to allow taxes to rise on the wealthiest Americans in order to protect entitlement programs such as Social Security, Medicare and Medicaid.

Lois Kilby-Chesley, president of the Maine Education Association teachers union, said the message that she and others were trying to send Wednesday was “kids not cuts.”
“We think the priorities need to be families and children,” Kilby-Chesley said in an interview. “There are other places where cuts could be made.”

The lobbying campaigns come as negotiations on the fiscal cliff are just beginning. Congress and the White House have just over a month to figure out a way to avoid the $500 billion combination of tax increases and across-the-board spending cuts.

Despite the negotiations, the political posturing continues as each side accuses the other of not offering serious compromises.

On Wednesday, Republican opposition to tax increases on wealthier Americans showed some signs of cracking, however.

Oklahoma Republican Rep. Tom Cole told his colleagues in a private meeting Tuesday that it’s better to make sure that tax cuts for the 98 percent of taxpayers who make less than $200,000 or $250,000 a year are extended than to battle it out with Obama and risk increasing taxes on everyone, The Associated Press reported. Cole is a confidant of House Speaker John Boehner, R-Ohio.

“If we don’t believe taxes should go up on anybody, why can’t we accept a deal that takes 98 percent out and still leaves us free to fight on the other grounds,” Cole said. “I’m not for using the American people for leverage or as a hostage.”

The Campaign to Fix the Debt, although nonpartisan, has yet to win strong support from many liberals or conservatives skeptical about the motivations of some of the organization’s leaders. The group’s leadership includes corporate executives from such major businesses as Honeywell, Aetna and Goldman Sachs. But the group also includes former governors and other politicians.

The campaign is being spearheaded in Maine, for instance, by two one-time political opponents: former Democratic Gov. John Baldacci and former Republican Maine Senate President Rick Bennett, who ran against Baldacci in 1994.

Speaking after a Fix the Debt news conference in the Capitol, Bennett said the group’s members are offering “broad-brush principles” rather than laying out specific proposals that might constrain negotiations. But they also stressed that this “critical moment” also is a chance to boost business owners’ confidence and show U.S. leadership.

“If we could get this right, I think we could unleash a real lion of economic growth,” Bennett said. “The alternative is too gruesome to really contemplate. I think we will get thrown into a recession. Interest rates … may go catastrophically through the roof. And we know that Moody’s and Fitch and S&P will likely downgrade the (credit) ratings.”

The White House released Maine-specific tax numbers Wednesday night as it seeks to show how letting tax cuts expire will affect non-wealthy citizens:

A family of four in Maine earning $78,300 would see its income taxes rise $2,200 if the cuts are not re-adopted. According to the president’s Council of Economic Advisors, allowing income taxes to rise for the middle class would slow the growth of Maine’s gross domestic product by 1.8 percent and reduce consumer spending in the state by $900 million in 2013.

Bennett and a group of other campaign members from other states met with U.S. Reps. Mike Michaud and Chellie Pingree, both Maine Democrats, as well as Rep. Dan Benishek, R-Mich.

Likewise, the MEA’s Kilby-Chesley as well as Maine AFL-CIO President Don Berry met separately with Michaud, Pingree and staffers within the offices of Maine Republican Sens. Olympia Snowe and Susan Collins.

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